Leiper v. Balt. & P. R. R. Co. et al.
| Decision Date | 07 October 1918 |
| Citation | 262 Pa. 328 |
| Parties | Leiper <I>v.</I> The Baltimore & Philadelphia Railroad Company et al., Appellants. |
| Court | Pennsylvania Supreme Court |
Before BROWN, C. J., STEWART, MOSCHZISKER, FRAZER, WALLING, SIMPSON and FOX, JJ. Reversed.
W. B. Linn, with him H. B. Gill, for appellants.
Lewis Lawrence Smith, for appellee.
OPINION BY MR. JUSTICE FOX, October 7, 1918:
Callender I. Leiper, the appellee, filed a bill in equity against the Baltimore & Philadelphia Railroad Company and the Baltimore & Ohio Railroad Company, praying for an injunction restraining the defendants from exceeding the rates specified in a contract made on the fifteenth day of March, 1887, between George M. Lewis, who was then the owner of certain stone quarries on a tract of land in the Township of Springfield, County of Delaware, State of Pennsylvania, and the Baltimore & Philadelphia Railroad Company.
The agreement in question in its second paragraph provided that the parties of the second part, and their successors, would transport in cars to be furnished by them stone of the parties of the first part from the quarries to any point on the line of their railroad between Fairview and the City of Philadelphia, and to all points on the Schuylkill River Railroad and its branches, at a rate of freight not more than forty cents per ton, and that the actual freight to be charged from the said quarries to Philadelphia and to all other points which may be or become competitive shall not exceed competitive rates. There was a further agreement to transport stone from the quarries to the landing on Crum creek for the sum of five cents per ton, or one dollar per twenty-ton car. The company also agreed to transport stone from the quarries to any siding of the company in the City of Chester and in the contiguous boroughs at a charge not exceeding twenty-five cents per ton.
By a conveyance dated the nineteenth of August, 1905, the appellee acquired all the estate, right, title and interest owned by the said George M. Lewis at the time of his death in and to the assets of a partnership formerly existing between him and the plaintiff, and in and to said quarries, including particularly the rights vested in the said George M. Lewis under the aforesaid agreement dated March 15, 1887, and the appellee thereby became the absolute owner of the quarries as well as the rights arising out of this agreement.
The consideration of the agreement was the grant of a right of way through and over the land appurtenant to the quarries, which, at the time of the agreement, was owned by the said George M. Lewis. The railroad company was also required by a provision of the agreement to locate a station at Avondale. Subsequently the Baltimore & Ohio Railroad Company, the other defendant, acquired by contract of leasing the property of the Baltimore & Philadelphia Railroad Company, and at the time of the filing of the bill was operating said line of railroad. It is conceded that the appellants have kept in every respect the terms and provisions of the agreement until the twenty-second day of February, 1915, when, in pursuance of the terms and provisions of the Public Service Company Law of Pennsylvania, the railroad company, having filed with the Public Service Commission a freight tariff raising the rates in question, claimed that it was entitled to collect from the appellee forty-two cents and twenty-six cents in place of the rate fixed in the agreement, namely, forty cents and twenty-five cents.
The learned judge of the court below finds as a fact that the freight tariff was duly printed, posted and filed according to the Public Service Company Law of Pennsylvania, and became effective February twenty-second, 1915, and that accordingly forty-two cents and twenty-six cents respectively became the lawful rates for the transportation of commodities described in the agreement in question between the points named in said agreement. The appellee made no complaint to the Public Service Commission of Pennsylvania as to the reasonableness of the rate thus fixed in the freight tariff by the railroad company, nor has he made any complaint to the Public Service Commission setting forth the facts alleged in the bill of complaint filed in this case, nor has he asked for any relief or made any application of any character to the Public Service Commission relating to the facts developed in the case at bar. Notwithstanding this fact the learned judge of the court below held that the defendant was without legal right to require from the plaintiff the payment of the rates fixed in said freight tariff for the transportation of stone, and held that as the rates already paid since February twenty-second, 1915, were paid under protest it was the duty of the defendant to refund to the plaintiffs the excess received by them, with interest thereon. The court further directed that an injunction issue, perpetually restraining the defendant from demanding or exacting from the appellee a higher rate for the transportation of stone within the State of Pennsylvania. Defendants were further commanded to receive and transport stone at the rates fixed in the agreement.
Under these facts has the court jurisdiction to make the decree that was entered in this case? One of the purposes of the passage of the Public Service Law was the creation of a tribunal by which the rates to be charged by public service companies in the State might be established. These rates must be reasonable in amount and must apply equally to all shippers. In the case of Armour Packing Company v. United States, 209 U. S. 56, considering a somewhat similar question, the court said "It cannot be challenged that the great purpose of the act to regulate commerce, whilst seeking to prevent unjust and unreasonable rates, was to secure equality of rates as to all and to destroy favoritism, these last being accomplished by the publication of tariffs, and forbidding rebates, preferences and all other forms of undue discrimination." The language of the Act of 1913, creating the Public Service Commission, in defining its powers, gives the commission much the same powers as the Interstate Commerce Commission under the act of Congress and the language used by Mr. Justice DAY in the case just quoted applies with equal force to the language of the Act of 1913. To permit the contract made between the appellee and appellants to stand as against rates established in a legal and orderly method and in conformity with the provisions of the law would be to nullify the purposes of the act. It would be impossible for the commission to enforce an equality of reasonable rates, except upon the basis that it is not bound by contracts previously entered into between a public service company and either a municipality, another corporation, or a private individual. The basis upon which this conclusion must rest is that under the Constitution of Pennsylvania, Art. XVI, Sec. 3, it is provided: "The exercise of the police power of the State shall never be abridged or so construed as to permit corporations to conduct their business in such manner as to infringe the equal rights...
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